Delta Air Lines to Build Heavy Maintenance Facility in Queretaro, Mexico

[eolesen]

WT, what you've quoted about DL's intentions are all fine and good, but has nothing to do with what I was saying. DL's not the only carrier serving ATL. And no, I'm not just talking about WN, either.

Putting a terminal on the far side of the airfield would be an option, but would make it quite difficult to tie into the people mover. It might be possible to put a charter/LCC terminal over there, but even that starts getting even more complicated than it needs to be. And, as mentioned two posts above, the shops don't need to be close to the runway. Having gates close to the people mover and existing garages/roadways is a little more pressing.

 

[WorldTraveler]

DL doesn't want any or have any more gates at ATL and DL has the authority by virtue of the leases to not allow anything to be built that has the potential to disproportionately affect DL's costs... same type of lease exists for AA at DFW etc..... Why do you think the city of Atlanta worked so hard to sell the ATL terminal deal to DL and DL held it up at several stages.

There are gates in ATL, there will be more as DL regauges its fleet, and gets rid of the 763 domestic fleet which allows a number of gates to be converted back to their standard size - a number of gates have been removed to accommodate widebodies on the domestic concourses - something that will not be needed as the 763 domestic fleet is retired.

And you also missed that the F concourse is half-sized right now.

The notion that the airport would shut down the TOC to build gates that aren't needed is pure fantasy.

You also seem to have missed the part about no airport in their right mind would displace a facility that employees 5000 people.

What is unchanged is that DL IS NOT moving the TOC - not to Mexico, not to AFW, not anywhere. A notion that DL would shut the TOC would be just as ridiculous as me saying that AA will just shut down TUL - after closing all of their other maintenance facilities. the TOC IS DL's maintenance operation, just as TUL is for AA, SFO is for UA etc.





move on.


DL and AM are spending $40M to build a facility that will be a tiny fraction of the size of the TOC... and that new facility will be the location where AM will do work which AM already does for DL elsewhere.

DL and AM will work together to gain new insourcing revenue as part of the maintenance joint venture.

Aviation week says:

"Under the memorandum of understanding signed by the carriers, they will move work currently being performed at Guadalajara International Airport to the new facility at Intercontinental Airport in Queretaro, next to that state’s Aerospace Park.
The new facility will enable heavy maintenance on as many as seven aircraft simultaneously, compared with three at Guadalajara, providing expanded MRO capabilities for the airlines’ own aircraft and for other carriers.
A Delta spokesman says the new facility will have the flexibility to accommodate virtually any size of commercial aircraft, from a regional jet to a Boeing 777.
Both carriers have offered heavy maintenance and overhaul services at the Grupo Aeromexico maintenance base in Guadalajara for the past six years."

 

[eolesen]

Time will tell. Moving the jobs to Mexico with your own labor would be a gutsy move. Certainly as gutsy as the refinery, and coming close to the Milwaukee Convention Center...

 

[WorldTraveler]

Time will tell. Moving the jobs to Mexico with your own labor would be a gutsy move. Certainly as gutsy as the refinery, and coming close to the Milwaukee Convention Center...

Except that there really is no evidence that DL is going to outsource any more of its maintenance ops than are outsourced today - which was the inference of the OP of this thread.

DL is going to build a joint maintenance base with AM as part of a maintenance JOINT VENTURE. AM already does work for DL Tech Ops. The original PR on the AM maintenance JV said it was intended to allow DL and AM to JOINTLY bid for maintenance work. There is nothing that says that is no longer the goal.

And unless DL guts its entire US-based maintenance operation, it isn't possible to expand passenger facilities at ATL into the area that is occupied by the TOC. The heart of the TOC is on the west end - closest to terminal F.
It also doesn't change that there is no need for more gates at ATL, there will be less of a need in a few years w/ DL's refleeting plan including the elimination of widebody domestic flying (which could still use gates on E and F), and that DL does have the right as the primary tenant to block airport projects which disproportionately add to DL's costs - which any new gates would do.

It also doesn't change that the south terminal complex - which would not be connected to the airport train - has been on the drawing board for years and no one has said they are willing to occupy those gates - in part because they would be far more expensive that the gates DL has.

It also doesn't change that DL has the capacity to easily add a couple hundred mainline flights at DTW w/o spending a dime on facilities.

It is possible we could be hit by a meteor that would end life on planet earth. But it is such a distant possibility that, like worrying about the closure of the TOC - it isn't worth even the bandwidth to argue the point.

 

[wings396]

Is all of this news supposed to give us a warm fuzzy feeling about jobs outsourced outside of the US? While DL may be consolidating the work under one roof, its still outsourced work no matter how you ice it up. Just curious if the DL mechanics have anything to protect more work from being done in the new Mexican facility in the future? We all know that cheap labor is king, and it wouldn't surprise me to see more and more work shifted from the US to Mexico in the future. I realize that many other airlines do the same, and I don't care for any of it.

 

[Kev3188]

Just curious if the DL mechanics have anything to protect more work from being done in the new Mexican facility in the future?

No.

 

[WorldTraveler]

Just curious if the DL mechanics have anything to protect more work from being done in the new Mexican facility in the future?

You mean one of those labor contracts that EVERY single US airline that had one waltzed into BK, petitioned that the contract be tossed, and either labor caved or the judge granted the company's wish.

And we could well see yet another US airline labor contract get tossed today....

Yet despite the lack of a contract, DL mechanics do more of the work on the DL fleet in house than any other airline except for AA, which itself just tossed its own labor contract just weeks ago, leading to dramatically more outsourcing.

In the US airline industry, there are no secrets, and maintenance expenses, including what is outsourced is regularly reported.

here is a nice pretty graph (page 9) to show you and others where US airlines stand on outsourcing.

Note also that AA's cost for outsourced maintenance was HIGHER in 2009 than DL's even though DL outsourced a slightly higher percentage.

Further, DL is the largest airline MRO in the Americas and brings in $500M in INSOURCED revenue via Tech Ops, a number that they intend to increase.
http://www.iata.org/...Report_FY09.pdf

We all know that cheap labor is king, and it wouldn't surprise me to see more and more work shifted from the US to Mexico in the future. I realize that many other airlines do the same, and I don't care for any of it.

Lowest cost is NOT necessarily the end all and be all; getting the job done right at the lowest cost is the goal - that is what well run businesses do.

It's probably why DL Tech Ops spoke at an IATA conference on outsourcing strategies - and note the performance metrics in the presentation they use to ensure the work is done as bid.

http://www.iata.org/..._Strategies.pdf

Wonder why an airline that outsources less than any other major US airline except AA - and DL may end up at the top of the list of the % of in-house maintenance by next year - was chosen to speak about how to successfully manage outsourcing, and still manage to use its facilities and people to make money on MRO work?

It's the same reason why DL mechanics have consistently expressed NO INTEREST in being represented by a union.

There are two ways to be fooled.
One is to believe what isn’t true; the other is to refuse to accept what is true.

Soren Kierkegaard

 

[Kev3188]

That was unecessary.

 

[WorldTraveler]

because... ?

 

[wings396]

But to sum it all up, they have zero protection should the company decide to shift more work to Mexico, correct? I had pretty much expected a page long response, while still skirting around the real issue.
Not to mention the future in house work that this could take away as well. I must say that this is the first time that I have seen someone attempt to put a positive spin on a US company promoting jobs in Mexico.

 

[WorldTraveler]

Except I said absolutely nothing about supporting or being glad about DL’s outsourcing to Mexico.
Quite the contrary.
To those, including yourself, who jumped on the news of this maintenance Joint Venture – which was announced months ago – to argue that it is a threat to American jobs belies the simple fact that there is an enormous amount of outsourcing by US airlines, and in fact, DL has a lower percentage of outsourced work and a lower actual dollar value of its outsourced work than any other nationwide legacy carrier.
Your suggestion that adding a couple more bays in Mexico puts DL jobs at risk because they are not protected by a contract belies all of the facts of the industry regarding outsourcing.
The uncomfortable reality for many is that organized labor HAS NOT stemmed the flow of jobs away from the borders of the US – a goal I wholeheartedly support.
It hasn’t resulted in more jobs being retained at home.
If organized labor, esp. in the labor industry, was a person, it would have been fired years ago for failing to do its job.
Those are not words that I expect to find a lot of support on this forum….. but it doesn’t change the fact that it is the truth.
It is impossible to deny that an airline that has non-union maintenance has done a better job of retaining US jobs, including through insourcing, than any other US airline maintenance operation.

--
The marketplace of ideas includes a lot that are contrary to what we believe. We can walk away from the people who say those things and shut down the message and the messenger OR we can listen to the message and engage it and attempt to show that it is wrong OR we can recognize that it is perhaps possible that someone else might actually have insight that we don’t have – and walking away from the message or the messenger doesn’t change the reality of the situation.
Life is full of tough news. At times we have to acknowledge we are on the wrong track.

Walking away from those who speak the truth just because we don’t like the message or the delivery doesn’t change the truth or that it will eventually become apparent.

 

[wings396]

At this point its only a couple of bays, and Delta does x amount of work in house, but that can easily change. IMHO, its a disgrace for ANY American based company to be associated with a facility in Mexico, or anywhere else outside of the US. I know a lot of companies do it, and I try to avoid thier products, GM included especially after their government baiil out. Within a few years, Delta could decide to triple the size of this Mexican facility, and nobody can do squat to stop them.

 

[yoyodyne]

At this point its only a couple of bays, and Delta does x amount of work in house, but that can easily change. IMHO, its a disgrace for ANY American based company to be associated with a facility in Mexico, or anywhere else outside of the US. I know a lot of companies do it, and I try to avoid thier products, GM included especially after their government baiil out. Within a few years, Delta could decide to triple the size of this Mexican facility, and nobody can do squat to stop them.

Of course, to do all the MTC on those AA-US planes...

 

[blue collar]

You mean one of those labor contracts that EVERY single US airline that had one waltzed into BK, petitioned that the contract be tossed, and either labor caved or the judge granted the company's wish

It's funny, the 'whole truth' isn't exactly the whole truth is it? WN has one of those pesky labor contracts, and the last time they went bankrupt was.... never?

 

[wings396]

Of course, to do all the MTC on those AA-US planes...

Never said that I liked or agreed with any of it at any airline. It all equals American jobs lost to cheap labor, that can't read the overhaul literature in many cases.